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UPDATE 1-DirecTV reports strong U.S. subscriber growth

Liana B. Baker
Tuesday, 5 Nov 2013 | 8:55 AM ET

Nov 5 (Reuters) - Satellite TV provider DirecTV added more U.S. customers than expected in the third quarter, showing strong subscriber growth in contrast to its cable rivals.

DirecTV added 139,000 net subscribers in the United States in the quarter, nearly double the gain of 70,000 that analysts expected, according to research firm StreetAccount.

In contrast, Time Warner Cable Inc said last week that it had lost more than 300,000 video subscribers, while Comcast Corp said it had lost 129,000. Another cable company, Charter Communications Inc, reported a net video subscriber loss of 27,000 on Tuesday.

Time Warner Cable blamed a monthlong blackout of CBS for some of its deep subscriber losses in video.

DirecTV, meanwhile, kept subscribers on board, as churn, or the rate of cancellations, improved to 1.61 percent from 1.74 percent a year earlier.

"DirecTV didn't give customers any reason to cancel in terms of blackouts or anything like that," said Brean Capital analyst Todd Mitchell. "DirecTV has been good at picking up customers after blackouts."

Shares of DirecTV rose 2.5 percent to $66 in trading before the market opened.

ISI analyst Vijay Jayant said the low churn could be because of the company's exclusive National Football League Sunday Ticket package, which lets DirecTV customers watch out-of-market games every Sunday. Promotion for that product ramped up in the third quarter.

Net income attributable to DirecTV was $699 million, or $1.28 per share, compared with $565 million, or 90 cents share, a year earlier.

Excluding a fee settlement and other special items, earnings came to $1.13 per share, which beat the analysts' average estimate by 12 cents, according to Thomson Reuters I/B/E/S.

Revenue rose 6 percent to $7.88 billion, narrowly exceeding analysts' estimates of $7.84 billion.

In Latin America, DirecTV added 260,000 subscribers, while StreetAccount was looking for 371,900.

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